COMMISSIONER OF Income Tax, MADRAS vs S. L. MATHIAS.

LEACH, C.J. - The Commissioner of Income Tax applies for a certificate permitting him to appeal to His Majesty in Council in respect of a

decision of this Court on the effect of the second proviso to Sec. 4(2) of the Indian Income Tax Act. There can be no doubt that the question

involved is a substantial question of law. As a matter of fact this Court placed a different interpretation on the proviso from that placed upon it by

the Calcutta High Court.

The application is, however, opposed by the respondent on the ground that an appeal to His Majesty in Council would put him to considerable

expense. He contends that if leave is granted it should be subject to the condition that the Income Tax authorities pay his costs. It is quite clear that

we have no power to impose any such condition and this was pointed out by this Court in the case of Rajarajeswari Sethupathi v. Tiruneelakantam

Servai (44 M.L.J. 217). Our powers are confined in this respect to those conferred by Sec. 66-A of the Income Tax Act and the provisions of the

Code of Civil Procedure, which have been made applicable to such appeals. Their Lordships of the Privy Council have on occasions, stipulated in

granting special leave to appeal that the appellant shall bear the costs. But we have no such powers, as I have already indicated. When the appeal

is heard in the Privy Council their Lordships will then decide the question of costs.

The learned Advocate for the respondent also says that leave should not be granted because the amount involved is less than Rs. 10,000. The

actual amount of the tax in question is Rs. 3,500. But the respondent carries on as a planter a large business in the Mysore State and the question

will arise each year while he remains in this business. Therefore, in the end the amount of tax will be very considerable. The learned Advocate has

in this connection referred to the decision in Rajarajeswari Sethupathi v. Tiruneelakantam Servai, as the Court there refused leave to appeal to His

Majesty. That was a case in which the petitioner was wishing to challenge a decision in respect of arrears of rent. There was a large number of

respondents, but in each case the amount owed or alleged to be owed was very small. The decision does not apply to the present case because

the amount involved, as I have indicated, is really substantial. The application for a certificate will, therefore, be granted.

Leave granted.